Arbitration and Closing Your Case
- April 9, 2021 @ 12:18 pm
- Written by adminjbwp
- Categories: Lawsuits | Legal Process
Regardless of whether your lawsuit pertains to an auto accident, a train accident, or any other kind of incident that caused a personal injury, you will most likely go through arbitration or mediation. Check out our article on how to prevent railway accidents.
Arbitration is another form of alternative dispute resolution. Like mediation, it brings the parties together before an impartial third party who understands the applicable law and will keep order during discussions. And like mediators, arbitrators are often retired judges or lawyers with experience in the legal area affecting your case, with a fee that will usually be split evenly between the parties. But unlike a mediator, an arbitrator does not actively guide the conversation or give opinions. Arbitrators are more like judges who keep order and rule on questions about the law, and eventually, on which party should prevail. In non-binding arbitration, the resulting judgment is only a suggestion; in binding arbitration, the decision is usually final.
At a non-binding arbitration, both parties present their cases as they would in mediation. But instead of holding the conference that a mediator would hold, an arbitrator simply decides which side should prevail and how much the plaintiff might be entitled to in damages. The idea is to show the parties how an impartial person sees their case, which encourages them to settle. The arbitrator’s decision is non-binding, so if you do not agree, you are free to continue to trial. However, in some jurisdictions, you may be penalized for this if the court ordered the arbitration, or if you go to trial and do not do as well. Your lawyer should be able to tell you about the rules that apply to your case.
Binding arbitration is just like non-binding arbitration, except that both parties agree beforehand to abide by the arbitrator’s judgment. You and your lawyer can choose binding arbitration, or you may be contractually obligated to use it. Binding arbitration can be advantageous for parties who want to resolve their cases more quickly, and sometimes more cheaply, than they might be able to in court. However, because it is hard to challenge the judgment produced by binding arbitration, it is important to understand before the arbitration that you usually must follow the decision of the arbitrator. In fact, you may be penalized for ignoring or defying that decision. Your lawyer can give you a professional opinion on whether binding arbitration is a good idea in your case.
Closing Your Case
Reaching a settlement can provide some satisfaction in knowing that your legal claim is finally going to be behind you. But you must still complete the closing process, which is an important part of finalizing your case and can take time.
Usually, you will be asked to sign a form called a release that formally concludes all current and future claims against the at-fault party and/or insurance company for these injuries. Because signing this ends your right to collect any more compensation for your injuries from this defendant, you should understand this completely and raise any objections before you sign it. Do not hesitate to bring up questions or concerns with your lawyer. After it is signed, both sides will notify the court that the case has been resolved and ask to dismiss any lawsuit.
As part of the closing process, your lawyer may have to address outstanding bills, claims or liens on your settlement proceeds, as discussed in the section entitled “Understanding a Settlement Offer.” This may mean that you have to pay some of your settlement to a third party, or that part of your settlement payment may be held by your law firm while questions about payment are resolved.
Settlement proceeds are sent directly to your law firm. Injury law firms have bank accounts called trust accounts, where they hold money belonging to clients until their cases is finalized. (This is a lot like holding money in escrow for people who are buying or selling a home.) Ethics rules forbid lawyers from using this money for their own purposes. Your settlement check will go into this account at first. You will probably sign a statement authorizing the law firm to deposit it.
The net settlement proceeds will be released to you after you sign a form called a closing or settlement statement, which typically ends your case and your client relationship with the law firm. It also lists all of the disbursements of the settlement funds, which includes payment of legal fees and costs, outstanding medical expenses, liens, and any other debts to be paid out of the settlement, as well as your own payment. Again, you should not hesitate to bring up any questions or concerns about this document. If you have special circumstances or a particularly complicated case, your lawyer may bring up other ways your settlement proceeds might be disbursed, or have suggestions designed to serve your best financial and legal interests.
Your law firm cannot write you a settlement check until this paperwork is done, and in many states, until after a legally required waiting period is over. If you are concerned about receiving the money quickly, it is important to take care of the paperwork as soon as possible.